Raymond James & Associates snagged six new recruits from Wells Fargo Advisors, making three hiring grabs managing over $1 billion from the wirehouse in a one-month period.
The new hires, who came over in three groups in recent weeks, are the latest sign that Raymond James' long-running recruiting tear isn't letting up yet. Wells Fargo, meanwhile, has suffered from advisor attrition over the past year-and-a-half. The firm has also suffered in its banking division. There has been heightened regulatory scrutiny of its consumer banking operations following several scandals, including the opening of millions of fake accounts without customer approval.
In the first quarter, Wells Fargo’s brokerage force shrank by 258 advisors year-over-year, according to the company’s earnings statement. The wirehouse lost other advisors to SunTrust and Stifel this year, among others.
Timothy Sloan, CEO of Wells Fargo, told investors on a conference call in early May that he has read stories of employees leaving en masse and “[doesn’t] know what company they are talking about because it is just not happening.” Turnover is down across all businesses and financial advisor productivity is up 7% year-over-year, he said.
Michael Terrana, CEO of Terrana Group, a recruiting and consulting firm for advisors and financial services, says advisors are leaving wirehouses across the board, but especially Wells Fargo.
“Now is not the time to move to Wells Fargo —it’s the time to leave Wells Fargo,” said Terrana. “And industry-wide, you can see that happening… I mean, every week we see some type of exodus from Wells Fargo.”
A spokeswoman at Wells Fargo declined to comment on all three departures.
There are a few good-sized teams at Wells Fargo working with Terrana Group to switch firms, Terrana says, adding he expects more advisors will leave the wirehouse this year and next.
However, earnings for Wells Fargo wealth and investment management division were up 7% year-over-year, according to the first-quarter earnings report. The wealth management business includes wirehouse, bank-based and independent advisors.
Meanwhile, Raymond James reported its largest advisor headcount to date last quarter: 7,604 advisors across its divisions, which is greater than the headcount of wirehouse UBS. Raymond James’ second-quarter earnings rose 5% from the preceding quarter and 16% from the second quarter of the previous fiscal year, according to the company’s earnings reports.
Raymond James, which is one of Terrana’s clients, has been growing year-by-year for a decade, he says, due to a strong company culture and top-notch technology.
The three new Raymond James teams are spread out in Connecticut and Michigan.
Thomas Monroe and John McDermott operate as Monroe McDermott Wealth Management in West Hartford, Connecticut. Monroe worked for 10 years at Wells Fargo, according to BrokerCheck, and 10 years at A.G. Edwards and Sons, Inc. before it became Wells Fargo Advisors in 2008. McDermott was at Wells Fargo and A.G. Edwards for 24 years. They oversaw $336 million in assets at Wells Fargo, says Raymond James.
Craig Cooley, Lee Miller and Michael Wegener make up Water Street Wealth Management in Bay City, Michigan. Wegener was at Wells Fargo for seven years, according to BrokerCheck. Cooley and Miller worked at Wells Fargo and A.G. Edwards for 14 and 19 years, respectively. They managed $500 million at Wells Fargo, according to Raymond James.
Tim Godin operates in Farmington Hills, Michigan as Godin Wealth Management. He was at Wells Fargo, and prior A.G. Edwards, for 27 years, according to BrokerCheck. He managed $260 million in client assets at Wells Fargo, says Raymond James.
Cooley said his team had been considering moving firms for about two years. They had narrowed the decision down to Raymond James and Stifel, but chose Raymond James because of its larger size.
“We were looking for a culture that allowed us to put clients first and service them as best we could, and the back office to support that,” said Cooley. “In the one month we’ve been here at Raymond James, I’m confident we’ve found it. It’s been a really good experience.”
While still in early days, it appears they will be able to retain most of their clients, Cooley said.
Godin said in a statement that he chose Raymond James primarily because the firm’s values aligned with his own. He declined to offer further comment on the move.